USING THE ACTIVITY-BASED BUDGET (ABB) IN IMPLEMENTING THE COST LEADERSHIP STRATEGY AND IMPROVING PROFITABILITY: APPLIED STUDY IN AL-DIWANIYAH TIRE FACTORY

Abstract

The research aims to address the theoretical framework of activitybased budget, with an indication of the role that it can play in implementing the strategy of cost leadership and improving profitability, through the application of the proposed methodology for preparing this budget and a statement of the strategic impact of it, which is reflected in an increase in the revenues of the economic unit or in a decrease in its costs or both together, which will be reflected in the increase and improvement of profitability. The research was applied in one of the factories affiliated to the General Company for Rubber Industries, which is Al-Diwaniyah Tires Factory, on the data for the fiscal year 2016. The budget was prepared on the basis of the activities of the research sample factory, and a set of conclusions was reached, the most important of which was that the use of the budget based on the activities in the Diwaniyah tire factory can help in implementing the cost leadership strategy as well as improving profitability